It developed a notorious reputation in connection with its role in the affair between Johann Friedrich Struensee and Queen Caroline Mathilda in the 1770s.

The palace was designed by Lauritz de Thurah for King Christian VI and his consort Queen Sophie Magdalene, and was intended as their summer residence.

[2] By the middle of the 17th century a royal tradition had developed whereby the ruling king bestowed Hørsholm Palace to his consort, and it was used as a summer residence.

The Dowager Queen Sophie Magdalene died in 1770, and the palace was taken over by King Christian VII who used it as a summer residence for his family and court.

On 17 June 1771 the royal family and court took summer residence at the palace, and on 7 July Queen Caroline Mathilde gave birth to her second child, Princess Louise Augusta, whose father was almost certainly Johann Friedrich Struensee.

The park surrounding the church, which is located on a small island in a lake, still bears some evidence of the original palace garden.